Spain's Startup Law: who qualifies and what you get

Terms used

• Beckham — The Beckham law is Spain's special tax regime for some newcomers who move to Spain for work.
• ENISA — ENISA is Spain's state innovation agency, which assesses whether a company is innovative and issues the report needed for startup status.
• Cl@ve — Cl@ve is the government's online identity system, used to sign in and sign applications electronically.
• Registro Mercantil — The Registro Mercantil is the company registry where businesses and their official details are recorded.
• Beckham regime — The Beckham regime is a special tax regime for certain people who move to Spain to work.

Key rules

• Age and size: A company qualifies if it is under 5 years old (7 in strategic sectors) with turnover below €10 million.
• Tax rate: Certified startups pay 15% instead of 25% in the first profitable year and the following three years.
• ENISA: You need a favourable ENISA report first, then the registered label, before you can claim tax benefits.
• Losing status: Status can end early if you list, pay dividends, lose independence or pass the turnover limit.

Who qualifies

Your company can be a certified startup (an "empresa emergente") if it meets all of these:

• It was incorporated less than 5 years ago, or less than 7 years ago in biotech, energy, industrial and similar strategic sectors, and its turnover is below €10 million.
• Its registered office, head office or main place of business is in Spain, or it has a permanent establishment there.
• At least 60% of its employees have an employment contract in Spain.
• It is not listed on a regulated market, and it was not formed from a merger or split of businesses that were not new.
• It is independent and does not distribute dividends.
• Its business model is innovative, with a scalable product, service or process.

The checklist below turns these into a to-do list.

How to get the status

ENISA, the state innovation agency, decides whether your company is innovative. Everything starts with it.

1. Apply online through the ENISA electronic portal. You need a digital signature or Cl@ve.
2. ENISA assesses the innovation criteria and issues a favourable or unfavourable report. This normally takes a few months.
3. With a favourable report, you apply for the startup label and its registration. This lets the Registro Mercantil (the company registry) recognise the label, and you use it to claim tax benefits.

The report alone does not give you the tax benefits. You need the registered label. The timeline below shows the order.

What you get

Tax benefits

• Corporate income tax at 15% instead of 25% in the first profitable year and the following three years.
• Deferral of tax debt for the first two years, with no guarantee and no interest.
• No fee on corporate tax advance payments (pagos fraccionados).
• For investors, a 50% deduction on investments up to €100,000 per year.
• For employees, stock options exempt up to €50,000 a year. Tax is deferred to the date of sale or listing.

All of these come with conditions, so check the details with the Tax Agency before you plan around them.

Other benefits

• No registry or notary fees when you incorporate, and faster formation through the CIRCE point.
• Easier public procurement and priority access to public funds, such as CDTI and ENISA programmes.
• Special terms for paying founders' Social Security.
• For foreign founders, an entrepreneur visa and a residence permit for entrepreneurial activity. ENISA must assess the project as innovative. There is also a digital nomad visa for remote workers.
• Founders may be able to use special tax regimes such as the Beckham regime.

How long it lasts

Certification lasts up to 7 years from incorporation, or 9 for biotech and certain deep-tech companies. It ends early if the company is listed, distributes dividends, stops being independent, or passes €10 million in turnover. Tell ENISA about any change that affects the criteria.

Timeline and deadlines

• Prepare your company documents and get a digital signature or Cl@ve (the government's online identity system): before you start

• Apply to ENISA, the state innovation agency, through its electronic portal: once your documents are ready

• Wait for ENISA to assess the innovation criteria and issue its favourable or unfavourable report: within three months of applying

• Apply for the startup label and its registration, so it is recognised in the Registro Mercantil (the company registry): after you receive a favourable report

• Claim the tax benefits using the registered label: once the label is registered

• Tell ENISA about any change that affects the criteria: whenever your situation changes

Checklist before applying for startup status

Before you apply for startup status

• Check that your company is under 5 years old, or under 7 years old in biotech, energy, industrial and similar strategic sectors, with turnover below €10 million.

• Confirm the company is not listed, was not formed from a merger or split of non-new businesses, and is not distributing dividends.

• Gather the incorporation deed, tax ID and company registry data.

• Gather proof of your registered office or Spanish permanent establishment.

• Prepare a business plan describing the innovative project, product, team and market.

• Prepare your accounts or financial projections.

• Prepare a statement of ownership saying the company is not listed and does not distribute dividends.

• Collect proof of your employees in Spain to show the 60% rule.

• Collect evidence of innovation, such as patents, prototypes, awards or funding.

• Get a digital signature or Cl@ve (the Spanish government online ID) ready for ENISA's online portal.

• Apply to ENISA, the state innovation agency, for its report on your company's innovative nature, then apply for the startup label and registration.

What to watch out for

• Your status can end before the time limit: Certification lasts up to 7 years from incorporation, or 9 for biotech and certain deep-tech companies. It ends earlier if you list the company, distribute dividends, stop being independent or pass €10 million in turnover. You then lose the benefits. Check these points each year before you act, and notify ENISA of any change.

• An ENISA report alone does not give you the tax benefits: The tax benefits depend on the startup label being registered, so claiming them with only the report can fail. Apply for the label and its registration as soon as you get the favourable report.

• Tax advantages come with conditions: The reduced tax rate, the tax deferral and the investor and employee breaks each have their own limits, and relying on them without checking can lead to a tax bill. Ask your adviser or the Tax Agency, Spain's tax authority, to confirm the current rates and limits before you plan around them.

Frequently asked questions

Can foreign founders get a visa through startup status?

Yes, the Startup Law created an entrepreneur visa and a residence permit for entrepreneurial activity, but ENISA must first assess your project as innovative.

Do employees get a tax break on stock options in a startup?

Yes, employee stock options are exempt from tax up to €50,000 a year. Tax is deferred until the shares are sold or the company is listed.

Does startup status make setting up the company cheaper or faster?

Yes, a startup is exempt from the registry and notary fees for incorporation. Formation is also faster through the CIRCE point, the one-stop service for creating companies.